Hotels Take On Travel Booking Services

Sometimes buying direct pays — and that is increasingly true when traveling to certain hotels. In an effort to lower the payments hotels pay to online travel websites, Hilton Worldwide Holdings Inc. and Marriott International are offering exclusive discounts to members of their loyalty programs.

According to a report in The Wall Street Journal, the discounts can be as high as 25 percent, granted the loyalty members book their stays through the hotel website instead of an online travel operator like Expedia or Priceline. Take Hilton, for example. Earlier in the year the hotel operator unveiled an advertising campaign aimed at getting people to book through the Hilton website or app.

In June, Choice Hotels International began piloting a member rate, following on the heels of moves by other competitors including Hyatt Hotels, Wyndham Worldwide, Marriott and Hilton. Choice Hotels is giving members discounts that amount to as much as 10 percent in some instances, while Marriott offers discounts of 2 percent to 5 percent.

Previously steep discounts weren’t part of loyalty programs, but in 2016 hotels began offering discounted rates to members in order to compete with online travel sites. Loyalty members traditionally only got perks like room upgrades, rewards points and free Internet access.

According to The Wall Street Journal hotels ink contracts with online travel websites that preclude them from giving cheaper rates on their websites. Hotels have said they can offer the discounts to members via the loyalty programs as a way around that. Expedia, which owns a few online travel websites, has reportedly reacted to the move on the part of the hotels by pushing the search results from those hotels lower down on its sites.

“The owners are going to be the ones to pay the price for the discounting strategy,” said Cyril Ranque, president of lodging partner services at Expedia. “We believe that it’s not a sustainable situation.”